* U.S. gasoline and distillate inventories weigh on prices
* Fed leaves interest rate near zero, dollar strong
* China loan tightening curbs risk appetite
(Recasts, updates throughout)
By Rebekah Kebede
NEW YORK, Jan 27 (Reuters) - Oil prices dipped on
Wednesday, pressured by rising U.S. product inventories builds
due to ongoing weak demand in the world's top oil consumer.
The U.S. Federal Reserve's decision to hold interest rates
near zero also weighed on prices as it pulled the U.S. dollar
higher and led Wall Street lower. []
U.S. oil for March delivery <CLc1> settled at $73.67 a
barrel, down $1.04, briefly dipping below the 200-day moving
average of $73.66. Oil prices have fallen from above $83 a
barrel on Jan. 11.
In London, ICE Brent crude for March <LCOc1> settled at
$72.74 a barrel, down $1.05.
"Crude is being pressured by growing pessimism relative to
the pace and sustainability of recovery. It's affecting all the
markets, commodities, stocks and debt," said Mike Fitzpatrick,
vice president at MF Global in New York.
Gasoline stocks rose more than expected in the week to Jan.
22 by 2.0 million barrels to 229.4 million barrels, the U.S.
Energy Information Administration reported Wednesday morning.
[]
Distillate stockpiles, which include heating oil and
diesel, unexpectedly rose 400,000 barrels to 157.5 million
barrels, compared with a 1.7 million-barrel decline forecast by
analysts.
Crude inventories had a surprise draw of 3.9 million
barrels, which some analysts dismissed, citing weather-related
import delays in the Gulf of Mexico.
"What is more important is product stocks are up, which
indicates an awful demand situation," said Tom Knight, a trader
at Truman Arnold in Texarkana, Texas.
U.S. crude imports fell by 673,000 barrels per day to 7.87
million bpd, the EIA reported.
DOLLAR, CHINA WEIGH
The U.S. dollar climbed to a six-month high against the
euro on concerns over Greece's fiscal health and after the U.S.
Federal Reserve kept interest rates near zero. []
A stronger dollar makes commodities priced in the U.S.
currency more expensive for those holding other currencies.
U.S. stocks fell on Wednesday after the Fed said it will
keep interest rates near zero and investors remained cautious
before President Barack Obama's State of the Union address
Wednesday night. []
Concerns that demand for oil in China will slow after the
nation's largest bank said it would slow credit growth also
weighed on oil prices.
The Industrial and Commercial Bank of China said it had
stopped rolling over some loans in order to slow credit growth
after a surge at the start of the year. []
Analysts see the ICBC's surprise loan curbs as prudent
steps and conducive to sustainable growth.
"Commodities in general have been pressured by the Chinese
finally putting some force to try and slow down their economy,"
said Mike Zarembski, senior commodities analyst at
optionsXpress in Chicago.
Lending curbs and steps by the central bank to mop up some
of the cash sloshing around in the banking system have weighed
on global investor sentiment.
In its mid-January report, the International Energy Agency
pegged China's 2009 oil demand growth at 572,000 barrels per
day, a rise of 7.2 percent.
(Additional reporting by Robert Gibbons and Gene Ramos in New
York, Chris Baldwin in London, Alejandro Barbarosa in Singapore
and Aizhu Chen in Beijing; Editing by Walter Bagley and Lisa
Shumaker)
